Chap 016
Chap 016
6,120 $
Correct!
Pretax accounting income Depreciation for tax Taxable income Tax rate Tax payable
$ $ $
$ $ $ $ $
$ $ $
Student Name: Instructor Class: McGraw-Hill/Irwin Problem 16-04 ZEKANY CORPORATION General Journal Account Journal entry at the end of 2011 Income tax expense Deferred tax liability Income tax payable Journal entry at the end of 2012 Income tax expense Deferred tax liability Income tax payable Journal entry at the end of 2013 Income tax expense Deferred tax liability Income tax payable Journal entry at the end of 2014 Income tax expense Deferred tax liability Income tax payable Debit 9,000 2,880 6,120 Credit
- Correct!
- Correct!
Given Data P16-04: ZEKANY CORPORATION Asset cost $120,000 2009 $39,600 $60,000 30% 2010 $52,800 $80,000 30% 2011 $18,000 $70,000 40% 2012 $9,600 $70,000 40%
Depreciation Accounting income before tax and depr. Average and marginal income tax rate
Student Name: Instructor Class: McGraw-Hill/Irwin Problem 16-05 DEVILLE COMPANY Calculations 2011 $350,000 (50,000) $300,000 30% $90,000
Correct!
Pretax accounting income Installment sales Municipal bond interest Taxable income Tax rate Income tax payable
2011 (50,000)
Cumulative Temporary Difference $0 $50,000 $30,000 $5,000 $0 2014 $0 25% $0 (1,250) ($1,250)
Correct!
DEVILLE COMPANY General Journal Account Journal entry at the end of 2011 Income tax expense Deferred tax liability Income tax payable Journal entry at the end of 2012 Income tax expense Deferred tax liability Income tax payable Journal entry at the end of 2013 Income tax expense Deferred tax liability Income tax payable Journal entry at the end of 2014 Income tax expense Deferred tax liability Income tax payable Debit 105,000 15,000 90,000 Credit
- Correct!
Given Data P16-05: DEVILLE COMPANY 2011 $350,000 $50,000 2012 $20,000 $15,000 2011 Enacted tax rate 30% 2012 30% 2013 25% 2014 25% 2013 $25,000 2014 $5,000 2012 $270,000 2013 $340,000 2014 $380,000
Student Name: Instructor Class: McGraw-Hill/Irwin Problem 16-10 FORES CONSTRUCTION COMPANY Requirement 1: Calculations (in millions) Current Future Year Deductible 2009 Amounts (135) 5 10 (10) (120) 105 15 (15) 0 (25) 40% 40% 0 Correct! (10)
Prior Years 2009 2010 Accounting Loss Fine paid Loss contingency Taxable loss Loss carryback Loss carryforward Enacted tax rate Tax payable (refundable) Deferred tax asset
(75)
(30)
40% (30)
Correct!
40% (12)
Correct!
Deferred tax asset: Ending balance (balance currently needed Less: beginning balance Change needed to achieve desired balance
$10 0 $10
Correct!
Journal entry at the end of 2009 Receivable - income tax refund Deferred tax asset Income tax benefit
42 10 52
Requirement 2: Calculations (in millions) Operating loss before income taxes Less: Income tax benefit Tax refund from loss carryback Future tax benefits Net operating loss 135 42 10
Correct!
52 83
Loss contingency Operating loss carryforward Taxable income Enacted tax rate Tax payable Deferred tax asset
0 40% 0
Correct!
Deferred tax asset: Ending balance (balance currently needed) Less: beginning balance Change needed to achieve desired balance
$0 (10) ($10)
Correct!
Journal entry at the end of 2010 Receivable - income tax refund Deferred tax asset
24 10 14
- Correct!
- Correct!
Taxable Income Additional Information: 2011 pretax operating loss EPA penalty included in 2011 loss Accrued loss contingency included in 2011 loss Enacted tax rate
2009 $75,000,000
2010 $30,000,000